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$6.7 billion managed wifi opportunity said to be squandered

New research from XCellAir claims the industry is missing out on a $6.7 billion payday, as the managed wifi segment continues to be largely ignored.

XCellAir, which it should be noted operates in the managed wifi segment, believes 15% of consumers would be willing to pay for a wifi service to be managed by their service provider or a third party, paying on average $34 per year. While those numbers may not appear to be massive, XCellAir has calculated the its $6.7 billion figure through revenue lost from consumers willing to pay for managed wifi services, as well as OPEX savings from a reduction in helpline calls and engineer visits. Cash received from the service would total $3.3 billion, whereas savings would be ‘as much as $3.4 billion’.

While the claim seems to make sense, there is a degree of creativity around the numbers. Demonstrating money saved is a difficult one, and the use of ‘as much as’ is a very good way of extending a number to as high as possible. That is not to say there is not money to be made in the segment; if something can be outsourced by the increasingly lazy and demanding millennials, they will most likely pay for it.

“With wifi fast becoming the consumer’s preferred choice for connectivity, internet service providers need to ensure they are doing their utmost to meet service requirements,” said Todd Mersch, EVP of Sales and Marketing, XCellAir. “Our research reveals that there is nascent demand for managed wifi services, demand that they’re also willing to pay for.

“Against a backdrop of new uses for domestic wifi, from streaming media to smart home devices, it is remarkable that almost everyone surveyed had completely unmanaged Wi-Fi. Consumers are going to look to ISPs to provide and manage their wifi as more connected devices fill the home.”

Although the majority of consumers get their wifi equipment from ISPs, 74% according to the survey, new products such as Plume, Eero and Luma, offer self-management features. If things go wrong, these consumers still usually turn to their ISP, even if the problem might not be down to the ISP. In this light, there does seem to be an opportunity.

The survey claims 50% of consumers blame their internet service provider for problems with their wifi, regardless of who provided their router, and will thus call the ISP to solve the problem. If the ISP is being contacted irrelevant of the provider of the router, they might as well get some cash out of it.

While the source of the $6.7 billion claim may well be self-serving, XCellAir is a wifi management company after all, it doesn’t mean that there isn’t an opportunity for the ISPs.

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